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IPSA blog > Posts > Andrew McDonald on MPs’ pay: lessons from history?


July 30
Andrew McDonald on MPs’ pay: lessons from history?

Our fundamental review of MPs’ remuneration is, in many respects, a break with the past. For the first time, a body independent of Parliament will consult the public on MPs’ pay and will determine the outcome without a vote in the Commons. And so it represents a fresh start. But we'd be foolish to embark on this review without considering what lessons we might draw from the experience of those who have been here before us and, indeed, without looking at the history of MPs’ pay. The work of the Senior Salaries Review Body and of various committees and inquiries over the years represents essential reading for anybody with an interest in this topic.  In this blog I want to look primarily at what the pattern of expenditure over the last 40 years show us.


Let's look at a couple of charts which show the movements in MPs’ pay in cash terms and then in real terms (i.e. allowing for the impact of inflation). Both charts begin in 1971, the date from which a distinct allowance was established as a separate provision to cover the expenses MPs incurred in the course of their business. It should be added that the charts only reflects MPs’ pay: they do not take any account of their expenses or of their pensions. They show MPs’ pay in real terms and include, by way of comparator, movements in UK average earnings (for MPs’ pay and UK average earning their respective totals in 1971 have been indexed as 100).


2012-07-06 - PP blog article - graph A (2).png

2012-07-06 - blog article - graph B (2).png 

What can we learn from this information? Three points seemed to me to be especially striking. The first is that in real terms MPs’ pay does not recover to its 1971 levels for about eight years and it only decisively moves ahead of the starting level in 1996. The second point is to note that since 2002 MPs’ pay has declined in real terms at a time when the trend in the UK average earnings has been upwards. The third concerns the sharp periodic adjustments in MPs’ pay, something that is even more apparent if one looks at a longer time series (see, for example, the sharp increases in 1979 and 1996).

Of the many lessons that one might take from these charts, I will leave you with a couple. The relative movements of MPs’ pay and of UK average earnings in real terms since 2002 surely suggest that this is a good time to be looking afresh at MPs’ remuneration. And the sharp corrections encourage the view that there's been something perverse about the overall process by which MPs’ pay has been determined in the past. There is clearly a strong case to bring an end to the cycle of sharp adjustments and subsequent slow decline of pay. How might this be done? Should MPs’ pay be linked to that of other public servants? Should it be linked to a price or earnings index? Or should it even be linked to the performance of the national economy as a whole?

Tell us what you think – about the future adjustment of MPs’ pay levels and, for that matter, about the lessons you take from these charts.




[1] Paul Seaward, ‘A Summary of Members’ pay and expenses 1911-71’ (October 2011) [, accessed 04/07/12], pp. 29 – 43.





The graphs are wrong!

The first graph is titled 1971-2011 but has dates from 1912 -2011 but the average wage in 1912 was not £8,000 pa. Something is wrong. The second graph has dates from '71 to 2011 and appears to say that MPs salary in cash terms has risen by 1675% in 40 years. Please could someone contact me to explain. Charles Board
 on 12/12/2013 11:35 PM

John Sills, IPSA Policy and Communications Director

In response to Mr Board's comments:

1. Thanks for spotting typo in graph title. Should say 1911, not 1971. Amended.

2. The average wage for 1912 and all other years is calculated in 2011 money. So the salary of £400 is increased to take account of inflation (using the GDP deflator). This gives a figure for 1912 of £7,175, which you can then compare directly with the £65,738 which MPs were paid in 2011.

3. The changes in pay in cash terms may look extreme, but this is the effect of very high inflation rates in the 1970s and, to a lesser extent, the 1980s. These had a significant compound effect on all prices and salaries. So, believe it or not, MPs were paid £3,250 in 1971 in money of the day.
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